Seila Law v. CFPB (2020)

The Dodd-Frank Act of 2010 created the Consumer Financial Protection Bureau to regulate consumer financial products and placed it under a single director with a five-year term, removable by the President only for inefficiency, neglect of duty, or malfeasance in office. Unlike most independent agencies, which are run by bipartisan multi-member commissions, the bureau had one leader with broad power. Seila Law, a California law firm, challenged a bureau demand for documents, arguing that the bureau's structure was unconstitutional.

On June 29, 2020, the Supreme Court ruled 5 to 4, in an opinion by Chief Justice John Roberts, that the removal restriction violated the separation of powers. The Court described Humphrey's Executor v. United States as an exception for multi-member expert bodies that do not wield substantial executive power, and declined to extend it to a single director exercising significant authority. A separate majority held the restriction severable, so the bureau continued to operate with a director removable at will. Justice Elena Kagan, dissenting, said the decision ignored Congress's long practice of creating independent agencies.

The Court applied the same reasoning to the Federal Housing Finance Agency in Collins v. Yellen in 2021, and in CFPB v. Community Financial Services Association in 2024 it upheld the bureau's funding through the Federal Reserve. Seila Law's reasoning has been central to arguments that the President may remove members of multi-member commissions too, an issue the Court took up after the 2025 removals of commissioners at agencies including the Federal Trade Commission. In 2025 the administration also moved to sharply scale back the bureau, prompting litigation.